Compromise could provide $800M for S.C. roads

COLUMBIA — Legislators said this week that a tentative agreement could provide $800 million for road and bridge work across South Carolina without raising taxes.

A three-part infrastructure compromise approved by a panel of House and Senate members would provide up to $141 million in state taxes toward infrastructure in the fiscal year that starts July 1. The measure was crucial for a separate panel reaching agreement hours later on the overall budget plan for 2013-14.

The budget compromise provides no cost-of-living raises for state employees. Though it fully covers increases in their health insurance premiums, employees will pay 20 percent more out-of-pocket in their co-payments for doctor visits and prescriptions.

Whether to give employees a 1 percent raise was among the final sticking points. Though four of the six panelists voted for the raise, it failed because the two House Republicans voted “no.” Senate Minority Leader Nikki Setzler, D-West Columbia, says the vote means employees will see a reduction in their take-home pay, because of scheduled increases in their pension contributions.

The conferees unanimously adopted the $6 billion spending plan for state taxes following a day of behind-the-scenes negotiations. They did not publicly meet until after 9:30 p.m.

“It took some time, but we got there,” House Ways and Means Chairman Brian White, R-Anderson, said after the vote.

Senate Majority Leader Harvey Peeler called the infrastructure compromise the plan’s “bright and shining spot.” The separate measure was needed to direct how the money would be spent.

It calls for $50 million to go to the State Infrastructure Bank to fund major projects through borrowing. Up to $50 million from the current year’s surplus would go toward bridge repair. The proposal also transfers $41 million from the state sales tax on vehicles to the Department of Transportation for repairing secondary roads, representing half of the money that the tax — capped at $300 per vehicle — puts in the general fund.

Borrowing and federal highway matches could push the total to more than $798 million.

Setzler called the plan an unbelievable start toward addressing the state’s infrastructure needs.

“It’s certainly more than people conceived we could do in the first year and gives us momentum moving forward,” said Setzler, D-West Columbia.

Peeler, R-Gaffney, praised it as a bipartisan effort that helps all areas of the state by repairing rural roads and interstates while also providing construction jobs. He stressed it does so without raising taxes or fees, generally an unpopular idea in this deeply red state.

In her State of the State address, Republican Gov. Nikki Haley called funding infrastructure critical to the state’s economic development but promised to veto anything that raised the state’s 16-cents-per-gallon fuel tax, unchanged since 1987.

Her spokesman was noncommittal on Monday’s compromise.

“The governor has not hesitated to voice her strong support for strengthening infrastructure with funds we have available now,” said spokesman Rob Godfrey. “She is going to take a close look at the state budget as soon as the General Assembly sends it to her.”

Last year, the Department of Transportation estimated needing $1.5 billion yearly over the next 20 years just to bring state-maintained roads to “good” condition. Hoping to find a more palatable figure, a loose coalition of the state’s business leaders issued a report in January urging legislators to spend $6 billion over the next 10 to 15 years on the most critical projects.

The president and CEO of the state Trucking Association applauded the compromise.

“There has finally been an unavoidable realization that major attention is going to have to be paid to finding adequate funding for a highway system that’s in dire need of improvement, and this is a great first step,” said Rick Todd, whose group is part of the coalition. Legislative leaders found a way to provide substantial funding “without having to try to fight and force some tax fee increases, which is just politically not doable at this moment.”

Both the budget compromise and separate infrastructure measure require approval by both the House and Senate, which return to the Statehouse on Tuesday for a special session.

Passing a budget this week gives time for Haley to issue her vetoes and the Legislature to deal with them before the 2013-14 fiscal year begins in two weeks.

Last year, a continuing resolution kept the government running over a five-day gap before the budget took effect.